Budget negotiations heat up as New Hampshire faces rising costs

During a recent government meeting, key discussions centered around the upcoming budget preparations for the 2025-2026 fiscal year, with a particular focus on negotiations with various employee groups, including teachers. The New Hampshire retirement system has published its rates for the next year, which may influence budget allocations, although the legislature cannot reject these rates outright.

Health insurance costs are projected to see a double-digit increase, contributing to the overall budget challenges. The meeting highlighted that New Hampshire retirement and health insurance are among the largest budget items, with retirement being the third largest and health insurance second. Additionally, the HVAC bus bond payments will continue, with this year focusing solely on interest payments.

The budget process is set to begin internally in November, with meetings scheduled with department staff and principals in December. The approach to budget presentations will be revamped to provide a clearer breakdown of major areas, such as instruction, special education, and athletics.

Board members expressed appreciation for efforts to keep the budget increase at 1.58%, notably below the current inflation rate of 3.6%. This achievement is particularly significant given that a substantial portion of the budget—approximately 78%—is allocated to salaries and benefits.

Negotiations for five contracts, including those for teachers, are expected to impact the budget for the 2025-2026 fiscal year, with discussions anticipated to commence in the fall. The meeting concluded with a commitment to continue monitoring budget developments and adjustments, particularly regarding Medicaid reimbursements and potential changes in state funding formulas.